Havelock’s losses cut as big clients opt to spend

New contracts with some of its existing blue-chip clients helped shop-fitting firm Havelock Europa cut its losses in the first half of this year.

The Fife company, which was pushed into the red by the recession and government cutbacks, secured more business with high street brands including Lloyds Banking Group, Marks and Spencer and Virgin Money.

It also expanded its presence abroad, carrying out work in Europe, Hong Kong and China.

Yesterday it reported a pre-tax loss of £1.5 million for the six months to 30 June, down from £4.6m the year before. Revenue increased by 4 per cent to £42.9m and the group also managed to trim its debt pile from £19.7m to £17.2m by using its working capital more effectively.

Chief executive Eric Prescott said the trading environment remained challenging and the firm was investing in more sales staff to try and grow revenues.

“It’s about growing the top line and that isn’t easy, as we’ve got to avoid margin erosion,” he said.

He said the woes affecting the high street did not seem to be affecting Havelock’s blue-chip customers as much as it was those towards the bottom of the market. However, he said that the cautious mood meant decisions to invest were taken at a higher level and generally took longer to make.

The firm recently fitted out the new Virgin Money “lounge” in Edinburgh and Prescott described the newcomer on the banking scene as an “exiting client” which he hoped would provide more work as it sets up around the country.

With Marks & Spencer, Havelock has progressed from manufacturing some products to carrying out full shop fits.

The company’s educational supplies division saw revenue fall 6 per cent to £3.8m. But despite public sector cutbacks, Prescott said the company had a good backlog of orders stretching into 2013.

Revenues in Havelock’s point of sale printing business were down slightly at £10m, reflecting the ending of its contract to supply Somerfield after the retailer was taken over by the Co-op.

The company said management at the division had secured other customers to replace the lost business. It is now operating at full capacity during peak times and the firm is considering increasing capacity.

Havelock also announced the appointment of a new business development director yesterday. Paul Davis, who joins Havelock from property firm Simons Group, will focus on attracting new clients.